Over the last few years, Harris County homeowners have seen a shocking rise in property taxes. Annual tax bills have jumped significantly in the county, and many landowners are wondering what they can do to pay less.
If you are a Harris County homeowner, you can blame a combination of a strong real estate market and how Texas funds governmental services for your high bills.
Because Texas has no statewide income or property tax, city and county governments and schools rely heavily on local tax revenue. And the solid run of home price increases across Harris County has led to higher annual bills.
Luckily, Texas law grants homeowners some protection from sky-rocketing property taxes. For instance, the state Constitution provides you with the opportunity to file a property tax protest and your lower bill.
The Harris County Appraisal District (HCAD) is responsible for determining an annual appraisal value for all properties in the county.
According to Texas law, the appraisal value is supposed to estimate your home's market value as of January 1. Market value is based on the price a knowledgeable seller and buyer would agree to transfer the property for after a reasonable time on the market.
Once the HCAD sets an appraisal value for your home, that amount is multiplied by the tax rates charged by each local tax unit in your area to determine the amount you owe in taxes. Local taxing units include entities such as Harris County and your public school district.
When the local real estate market booms, sales prices increase dramatically.
In 2021, the average Harris County home value increased by 21%. Because HCAD factors local market conditions into each property's market value calculation, if the resale price of homes in Harris County rises, the appraised value used to levy your house's property taxes does as well.
Texas law offers homeowners some relief from rapidly increasing property tax bills. First, if you qualify for a homestead exemption, your home’s appraised value cannot increase by more than 10% over the previous year.
This means that, even though the average Harris County home saw a 21% increase in market value during 2021, the typical homeowner's appraised value could only legally increase by a maximum of 10%.
To receive a homestead exemption, you must apply. For your home to qualify, it must be your principal residence, and you cannot claim a homestead exemption on any other properties, whether in Texas or another location. Because of the 10% statutory cap, applying for your homestead exemption is critical to keeping your property tax bills as low as possible.
Additionally, if you or your partner are 65 years of age or older, you qualify for what is known as the Texas senior freeze. If you have received a homestead exemption, the senior freeze caps your local school district property taxes at the amount you pay the year you turn 65. Once you have a senior cap in place, even if your home's market value dramatically increases, your school district tax bill will remain the same
A final way for Harris County homeowners to seek property tax relief is by filing a protest with the HCAD. Due to the HCAD's use of mass-appraisal techniques and algorithms, the district's appraisal for your home may not match its market value. If the assessment is too high, you can file a protest and attempt to decrease the value and lower your bills.
Every Texas landowner has the right to file a property tax protest. A local Appraisal Review Board (ARB) in Harris County handles all hearings regarding incorrect appraised values.
After reviewing the evidence, the ARB can conclude your home's market value is lower than the HCAD's appraised value. This determination can result in savings on your annual property tax bills. And, because of the 10% cap, a reduced appraised value this year also provides benefits next year and every year after that.
Texas law also allows homeowners to have a professional representative assist them through the property tax protest process. Here at Watchtower, our experienced team is dedicated to advocating on behalf of Harris County property owners.
With our risk-free property tax protest services, we only get paid if we help you lower your tax bills. So, there’s no reason not to register for Watchtower’s services on our website today.
Property tax in Montgomery County - a property tax consultant can help you manage your tax obligations, exemptions, deductions, and how to challenge your assessment.